The Three Billion Enterprise Crowdsourcing and the Growing

Home , Crowdsource (app), Crowdsourcing, Open source, Tongal, Wiki, Wikistrat

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Contents

Foreword 1

Introduction 2

What is crowdsourcing? 4

Using the crowd in business 9

From closed to open 13

Endnotes 14

Contacts 16

Acknowledgements The authors would like to acknowledge the support they have received from a number of people in Deloitte while researching this publication, including Greg Howard, Renee Hunt and Ankur Borthakur.

We would also like to thank Marcus Shingles and Jonathan Trichel from Deloitte Consulting LLP for their formative thinking.

In this publication, references to Deloitte are references to Deloitte LLP, the UK member firm of DTTL. To start a new section, hold down the apple+shift keys and click to release this object and type the section title in the box below.

Foreword

Today’s innovation problems are tough to solve. The traditional methods that have served your enterprise well for decades no longer seem to work, and your current crop of young, talented millennials don’t want to stick around to help. Exponentially advancing technology, a rapidly growing online worker population and improved access to education all add up to a confusing medley of options.

You know that the best solution is out there somewhere but in an increasingly volatile, uncertain, complex and ambiguous world, it’s not always obvious what combination of people, skills and technology you need.

Thankfully, this dynamic environment is an enabler and not an inhibitor of an emerging, solution-finding method called crowdsourcing – the umbrella term for a variety of approaches that harness the time, expertise and resources of large crowds of online people. Crowdsourcing offers a way for enterprises to find new solutions and to offer otherwise frustrated and nomadic employees a greater diversity of work. It’s also creating new opportunities for individuals to change the way they work, learn new skills and earn rewards wherever they are, even in remote corners of the planet.

Once seen as the preserve of obscure state-sponsored competitions or corporate innovation projects, crowdsourcing is now considered mainstream, increasingly embedded in the core business activities of small and large enterprises alike. Vimi Grewal-Carr In 2014, Gartner predicted that 75 per cent of high-performing enterprises will use crowdsourcing in some form by 2018. Today, the online crowd is helping enterprises tackle a wide range of challenges, from menial tasks to more complex needs requiring specialised skills. It’s having spectacular results, too, in certain situations creating better and more scalable solutions at lower cost than even the best in-house teams.

Should you be thinking about crowdsourcing? Is it only for start-ups and small businesses or can it be used at enterprise scale? Can crowdsourcing be useful for more than just a technology solution? What are the ‘killer apps’ and how do they work? How do you manage the crowd to create value? And what are the cultural and commercial challenges you will face? In the following pages, we take a close look at crowdsourcing and tackle these questions.

In our view, crowdsourcing is part of an ecosystem of rapidly maturing technologies and methods that look set to play a Carl Bates fundamental role in the future of commerce and society. This paper – the latest in our series of reports under the title of ‘Disrupt: Deliver’ – aims to help business and public sector leaders understand the new and emerging opportunities for organisations in all sectors to create and deliver compelling services for their customers using the power of disruptive innovation.

We hope that you find this paper useful and we look forward to your feedback.

Vimi Grewal-Carr Carl Bates Managing Partner for Innovation Partner, Lead for Crowdsourcing Deloitte LLP Deloitte LLP

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Introduction

“To answer the most vexing innovation and research questions, crowds are becoming the partner of choice.” Kevin Boudreau, Karim Lakhani 1

Throughout history, crowds have been invited to tackle Businesses also have a rich history of trying to tap into tough literary, scientific and technological challenges that crowds, using consumer surveys, focus groups, and have stumped even the most brilliant minds. experiential marketing to provoke customer engagement. Product R&D, in particular, has seen significant activity, In 1567, King Philip II of Spain offered a reward to with open innovation campaigns launched by many large anyone who could devise a simple and practical method companies, including 3M, BMW, General Mills, and Stanley for precisely determining a ship’s longitude at sea.2 The Black & Decker.9 reward was never claimed. Almost 150 years later, in 1714, the British government established the ‘Longitude rewards’ After conversations about how today’s businesses through an Act of Parliament, after scientists, including were beginning to use the internet to outsource Giovanni Domenico Cassini, Christiaan Huygens, Edmond work to individuals, Jeff Howe and Mark Robinson, Halley, and Isaac Newton, had all tried and failed to come editors at Wired Magazine, were first to coin the term up with an answer.3 The top prize of £20,000, worth “crowdsourcing” in 2005.10 In conceptualising the term over £2.5 million today, provided a significant incentive to the following year, Howe suggested that “crowdsourcing prospective entrants. represents the act of a company or institution taking a function once performed by employees and outsourcing Ultimately, the Board of Longitude awarded a number of it to an undefined (and generally large) network of people prizes for the development of various instruments, atlases in the form of an open call. This can take the form of peer- and star charts. However, it was John Harrison, production (when the job is performed collaboratively), a clockmaker from Lincolnshire, who received the largest but is also often undertaken by sole individuals.”11 The amount of prize money overall – over £23,000.4 What is, term ‘crowdsourcing’ is often used interchangeably with perhaps, most astonishing about Harrison’s 300-year-old ‘open innovation’. sea clock design is that a test of a working version in 2015 demonstrated that it is “the most accurate mechanical Right now, crowdsourcing competitions like the $30 clock with a pendulum swinging in free air”, keeping to million Google Lunar XPRIZE, the $25 million Michelson within a second of real time over a 100-day test, according Prize or the £10 million 2014 Longitude Prize are to Guinness World Records.5 challenging – and incentivising – professional scientists, engineers, entrepreneurs and innovators from all over the The crowd was not just useful for technological planet, amateur and professional alike, to develop novel breakthroughs. In 1879, when Sir James Murray was solutions to the world’s ‘wicked’ problems.12, 13, 14 In more responsible for editing the first edition of the Oxford straightforward applications of crowdsourcing, platform English Dictionary (OED), he put out a call for volunteers to providers like Lionbridge and Samasource are helping identify all of the words in the English language together enterprises with language translation, data validation, with quotations illustrating their use.6 During the next 70 image tagging and other routine tasks that require flexible years, the OED received over six million submissions from access to large numbers of people with basic computer tens of thousands of contributors. Murray’s initiative has skills.15, 16 Wikistrat, OnFrontiers and 10EQS tap into the been compared to the modern-day Wikipedia in terms of specialist expertise of hundreds of thousands of people the scale of its ambition to gather and curate knowledge.7 worldwide to provide flexible, non-routine services such Wikipedia, itself, has grown from 15,000 articles at the as consultancy, market intelligence, strategy development end of its first year, in 2001, to over five million English and research.17, 18, 19 articles today, which have been edited over 800 million times by a crowd of nearly 28 million registered users.8

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Despite a growing number of success stories, though, And if it’s not the aggregate ‘wisdom of the crowd’ being relatively few businesses draw on the crowd in a systematic sought but simply the best person to fulfil a specific way. Pushing problems out to a vast group of strangers task, then companies like Gigwalk, Upwork, 99Designs, seems at odds with conventional corporate wisdom. Streetbees, DesignCrowd and Writology help businesses Managers, who have traditionally looked inward for connect with and manage talented experts right across solutions, are understandably wary. How, for example, can the world.28, 29, 30, 31, 32, 33 you protect intellectual property if it is exposed so publically? How can you manage the crowd to ensure it delivers? How For individual workers, the crowd creates opportunities for can you integrate a crowdsourced solution into existing a different kind of employment, greater freedom of choice corporate processes and systems? What about the costs? and sometimes bigger rewards, too. The idea of open And how can you be sure you’ll even get a good solution? source talent via crowdsourcing is itself growing in scale, sophistication and importance as an alternative staffing Today’s workers are also frustrated with the directions model.34 According to influential innovation academics their careers are taking. They want to work on a greater Kevin Boudreau and Karim Lakhani, “Crowds are energised diversity of projects, and concentrate their time on those by intrinsic motivations, such as the desire to learn or activities that drive both reward and social worth. Yet to burnish one’s reputation in a community of peers.”35 traditional career paths in business prize ever-deeper Reputation aside, the earnings of the most successful industry knowledge, experience or management crowdsourcing challenge participants can now also easily prowess – and workers trudge along these for years, and exceed $500,000 per annum.36 sometimes decades. Millennials, who represent one of the largest segments of the labour force, are not afraid This paper is intended to help businesses understand to switch jobs frequently, and now expect to work an crowdsourcing and its benefits. On the following pages, average of 12 to 15 jobs during their lifetime.20 Many of we examine what makes crowds tick and how businesses the millennials that Deloitte has surveyed do not believe can use the collective insight offered by crowdsourcing that their current employers are taking full advantage of to deliver greater diversity and breadth of ideas and their skills, and as many as one in four would quit their knowledge. We tackle many popular misconceptions jobs given the chance.21 associated with crowdsourcing, such as it can only be used at small scale by start-ups and small businesses. Employers, as a consequence, are in a never-ending We also cover potential challenges to process, risk, people ‘war for talent’ – cosseting specialists and experienced and culture. And, in light of our research, we explore professionals, and grappling with ever-tighter immigration how businesses can take simple but effective steps to find rules, which limit human capital flows across country innovative solutions that work for their business and for boundaries. And employees are looking for alternative their employees. approaches to work and reward. In such a fluid employment environment, how can you motivate and incentivise employees to stay? How do you help them to develop new skills? How do you inspire them to help tackle your own challenging problems or even give something back to society? Today’s workers are also frustrated with the directions their careers are taking. According to eYeka, a global market leader in creative crowdsourcing for marketers and creatives, 85 per cent of They want to work on a greater diversity the top global brands have used crowdsourcing in the last ten years.22 Gartner, Inc. anticipates that by 2018, of projects, and concentrate their time 75 per cent of the world’s high performing enterprises will on those activities that drive both reward be using crowdsourcing.23 That’s leading crowdsourcing companies, such as eYeka, InnoCentive, Kaggle and and social worth. TopCoder, to ‘industrialise’ approaches to finding optimum solutions, and they now manage many aspects of the innovation process to help businesses tackle problem- solving with a minimum of effort.24, 25, 26, 27

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What is crowdsourcing?

“Not everyone in the crowd wants to make silly videos.”

Jeff Howe 37

Right crowd, right problem Crowdsourced problems can be vast in scope, such As Jeff Howe said in his book, crowdsourcing is not a silver as SETIlive, a ‘citizen science’ project conducted by bullet for commerce.38 But the crowd does provide an Zooniverse in conjunction with the SETI Institute, which array of different approaches to help enterprises operate asked people all over the world to help with the search for more efficiently amid ongoing shifts in policy, science, extra-terrestrial intelligence.39 Or they can be exquisitely technology and skills, and the fluidity exhibited by the precise, such as seeking a new technology to remove wider economy. Businesses and other organisations are microbubbles from extracorporeal bloodstreams, a current finding that the crowd can help with a wide range of challenge competition managed by InnoCentive.40 challenges, from simple rote tasks, like image labelling, raising money or voting, through to far more complex problems, like brainstorming ideas, designing new products or even strategic planning.

Figure 1. Choosing the right crowd for the right problem [double-page spread] Collaborate Crowd collaboration e.g. openIDEO, Quirky Do you want respondents to Compete Crowd competition collaborate or e.g. TopCoder, Kaggle, InnoCentive compete to find a solution? Unresolved Crowd labour (microtask) problem e.g. openIDEO, Quirky Do you have a defined task to be Processing completed or an Crowd labour (mesotask) unresloved problem? Non– Do the tasks require e.g. Lionbridge, Samasource Defined specialist processing skills or task Does the task complex problem require specialist or solving skills? Crowd labour (macrotask) Best non–specialist skills? e.g. 10EQS, Wikistrat, OnFrontiers response Specialist Do you want the Business best response or as Crowd funding need many responses as e.g. Kickstarter, CrowdCude possible? Funding Many responses High quality Crowd curation e.g. Wikioedia, LINUX Do you want high quality or any quality Do you need Information content? Any quality information, funding User–generated content or some other e.g. YouTube activity? Other Active activity Crowd voting Do you want active e.g. Crowdtivate, Threadless or passive participation? Passive Crowd processing e.g. ReCAPTCHA

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Some attempts have been made to classify the astonishing Enterprise crowd platforms diversity of use cases into a standardised set of general Open approaches to innovation have long been the norm crowdsourcing approaches. But even these typologies for some companies. P&G’s ‘Connect + Develop’, for are in disagreement: some are problem-based while instance, has enabled the company to establish more than others are task- or even platform-based.41, 42, 43 Crowds, 2,000 successful agreements with innovation partners too, can be widely varying in size and skills of their around the world.46 In 2001, IBM started an internal members. For example, the freelance workers registered innovation experiment that has now evolved into its with on-demand micro-tasking platform TaskRabbit ‘InnovationJam™’ platform, which it uses to work with help consumers with everyday tasks, including cleaning, clients, helping participants to ‘jam’ by contributing their moving or delivery work, whereas the business challenges expertise and opinions in various topic areas.47 run by the competition site Kaggle, “the home of data science”, typically require members of the crowd to have But more and more companies and public sector high-end computer science, physical science, statistical or organisations are now ditching traditional innovation mathematical skills.44, 45 processes and are, instead, working with enterprise-scale platforms to reach broader crowds capable of generating So how can you choose what crowdsourcing approach is answers and executing tasks faster and more cost right for you? In Figure 1, we illustrate the paths to various effectively than their own employees. crowdsourcing models.

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Figure 2 illustrates different types of crowdsourcing platforms and their relative strengths and weaknesses.

Figure 2. Enterprise crowd platforms

Crowdsourcing model Good for Not so good for Examples

• Tasks requiring the aggregate • Promoting individual • 99Designs Crowd collaboration ‘wisdom of the crowd’ capabilities or expertise • X Prize • Predetermined outcomes • Quirky • Generating outside ideas

• Creating actionable solutions • Predetermined outcomes • TopCoder • Developing prototypes • Kaggle Crowd competition • Building a sense of community • InnoCentive • Generating outside ideas • Applause • ‘Gamiﬁcation’

• Well-deﬁned, everyday tasks • Poorly deﬁned, unstructured or • TaskRabbit for individuals that require non-routine activities • Amazon’s Mechanical Turk general skills only • Tasks requiring subjective • Streetbees judgement • Gigwalk • On-site manual work, such as • Tasks requiring specialist or • Samasource store restocking, furniture higher-level cognitive skills Crowd labour assembly and cleaning (microtasks) • Large crowds • When you don’t want to hire permanent employees or contractors • Real-time market intelligence or data gathering

• Well-deﬁned tasks that require • Poorly deﬁned, unstructured or • Lionbridge specialist processing skills non-routine activities • CrowdFlower Crowd labour • Routine but time-consuming • Tasks requiring subjective (mesotasks) activities, such as data entry judgement or specialist skills • When you don’t want to hire permanent employees or contractors

• Poorly deﬁned or unstructured • Routine tasks and activities • 10EQS tasks or problems, such as • Wikistrat strategy development, • OnFrontiers research or consulting • Applause Crowd labour • Tasks requiring subjective (macrotasks) judgement or specialist skills • When you don’t want to hire permanent employees or contractors

• Fundraising • Financing ongoing operations • Kickstarter Crowdfunding • Start-ups • Loosely structured initiatives • CrowdCube • High transparency • High short-term expectations

Crowd curation • Building and sharing • Solving deﬁned problems • Wikipedia knowledge • TripAdvisor User-generated • Building large content • Ensuring the best possible • YouTube content repositories quality of content • iStockphoto

Source: Deloitte

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Five billion workers by 2020 Figure 3. Number of internet users in the world The internet is the engine of the modern-day crowdsourcing platform. It provides both a broadcast 3500 mechanism for organisations to set or announce challenges and a network for connecting people and their 3000 diverse ideas, skill sets and knowledge. The number of internet users worldwide is growing exponentially, and 2500 has risen from just 414 million in 2000 to over 3.4 billion 2000 in 2016.48 At the current rate of growth, there will be approximately five billion internet users by 2020. 1500

The countries driving this growth include India, China, 1000 Brazil, Indonesia and the US, which collectively added over 136 million internet users last year (China, alone, 500 accounted for over 108 million).49 The change in India’s Number of internet users in the world (million) online population last year was over 30 per cent and, 0 despite their comparatively small populations, the other (est) 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 fastest risers, with 12-month growth rates in excess of 2016 Year (as of 1st July) 15 per cent, include Mali, Lesotho, Cameroon, Vanuatu, Source: Internet Live Stats Mauritania and Liberia.50

Mobile access to the internet is also growing, with 52.7 The implications for enterprises of this growth in per cent of the global mobile phone population accessing connectivity and education are immense. Crowdsourcing the internet from their mobile phone in 2015.51 This harnesses the creative and competitive spirit of people number is expected to reach 63.4 per cent by 2020, which all over the world. Sun Microsystems co-founder Bill means that mobile phones will be the most popular way Joy said in 1990, “No matter who you are, most of the for people to access the internet within four years.52 smartest people work for someone else”.54 Geolocation and low-cost mobile applications make it easy for smart One of the principal benefits of greater online connectivity is people everywhere to participate – even if just to do improved access to and provision of education – particularly small tasks. And in an increasingly volatile, uncertain, in developing economies and currently impoverished nations. complex and ambiguous operating environment, to Through programmes such as UNESCO’s Framework for develop a competitive advantage – or even just to survive Action, digital technologies are enabling international – “companies today need armies of people,” says Vivek commitments to be made to provide high quality primary and Wadhwa, a Fellow at Stanford Law School.55 But rather secondary education to all children, focusing on numeracy, than these armies being permanent employees, the crowd literacy, analytical problem-solving and other higher-level gives all organisations the ability to scale up and down cognitive, interpersonal and social skills needed in the future dynamically to match changing workload demands, and to global economy.53 find experts in different markets and geographies.

“No matter who you are, most of the smartest people work for someone else.”

Bill Joy, Sun Microsystems co-founder

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Boudreau and Lakhani describe a well-functioning crowd For location-based assignments, individuals carry GPS- as being “loose and decentralised” and the problem enabled devices, such as smartphones, that provide exposed to “widely diverse individuals with varied skills, on-the-spot data entry and performance verification. For experience, and perspectives.”56 As more people from all example, Clickworker, a German crowdsourcing company, walks of life shift online, therefore, the crowd can begin to draws on a pool of 700,000 ‘clickworkers’ in 136 countries operate at a scale that “exceeds even that of the biggest to take pictures, and gather geodata and other types of and most complex global corporation, bringing in many information for surveying and research.58 Others, such more individuals to focus on a given challenge.”57 The as Gigwalk, use mobile technology to help organisations diversity of backgrounds, knowledge, skills and abilities find and manage geographically dispersed teams and within the crowd can, under certain circumstances, lead workers, enabling more effective performance monitoring to better, cheaper or more scalable solutions than those and management.59 For temp agencies or outsourcers, developed by teams of in-house specialists. the talent pool is constrained by their rosters. In contrast, enterprise platforms like OnFrontiers and Wikistrat can How is this different from outsourcing or temporary provide easy access to specialists from many walks of agencies that have been around for decades? life – professionals, freelancers, and hobbyists – who have Crowdsourcing platforms can now match buyers to a the motivation, qualifications, and flexibility to create much broader base of sellers while reducing many of the innovative ideas and execute assignments promptly.60, 61 administrative hassles, combining cloud, mobile, social, and web technologies to create new marketplaces. Crowdsourcing is not a panacea, though, and does not always represent the right approach. So how should businesses new to crowdsourcing get started? What do they need to think about and do to ensure they benefit from the many crowdsourcing platforms available? How can they integrate crowdsourcing solutions and approaches into existing business models? In the next section, we take a look at how businesses create value from the crowd.

As more people from all walks of life shift online, therefore, the crowd can begin to operate at a scale that “exceeds even that of the biggest and most complex global corporation, bringing in many more individuals to focus on a given challenge.”

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Using the crowd in enterprise

“Organisations, by their very nature, are designed to promote order and routine; they are inhospitable environments for innovation.”

Theodore Levitt 62

How does the crowd deliver value? • Greater elasticity – when consumer products The crowdsourcing ecosystem is still relatively young, but change – as they do frequently, but also sporadically – as new platforms and use-cases emerge, the potential CrowdSource uses the crowd to provide retailers with for disruptive impact on the enterprise is significant. In new product titles, descriptions and marketing copy, shifting towards a more ‘outside-in’ approach to problem- enabling the retailers to benefit from increased agility solving, for example, crowdsourcing changes the way and a faster time to market.67 that businesses, public sector organisations and other enterprises create value. The size of a company, the number • Appetite for tedious tasks – TaskRabbit enables of employees, the tools and other intellectual property anyone to earn money by performing simple tasks or developed, or the exclusive agreements a company has with errands for customers who are time-poor or do not partners in its supply chain no longer limit the capacity of have the skills required for many types of task, such any organisation to discover and apply knowledge. Instead, as assembling flat-packed furniture, moving house or it is the greater access to knowledge the crowd provides decorating.68 and, in particular, the frictionless flows of diverse ideas enabled by crowdsourcing that now create value. • Access to new pools of external talent – SpringRole has been described as the “TaskRabbit of recruiting” by For businesses, the benefits of crowdsourcing can include: HR Tech Advisor.69 SpringRole enables ‘regular’ people to make money for the simple task of referring their friends • Faster design – in 2012, DARPA, the US Defence for job openings. Advanced Research Projects Agency, decided to crowdsource its next-generation amphibious fighting • Better engagement and retention of internal talent vehicle after shutting down its traditional procurement, – Thomson Reuters uses crowdsourcing internally to tap which had already cost taxpayers $13 billion.63 The into the skills of its 17,000 technologists, finding new winning design was announced in April 2013, just six problem solvers and breaking down department silos.70 months after the competition was launched.64 In certain situations, crowdsourcing can also lead to • Faster prototyping – When small-scale prototyping lower costs. For example, Colgate Speed Stick used the matters, TechShop, a US-based chain of workshops crowd to create a Super Bowl advert for the bargain- described as an “inventor’s playground”, allows members basement price of $17,000, compared with the nine-figure of all skills levels to use its suite of modern industrial tools sums usually associated with traditional agencies.71 In and machines, such as 3D printers and robots, to build general, crowdsourcing has forced down the costs of their own projects quickly and cost-effectively.65 experimentation while simultaneously improving the quality of output. This has allowed all organisations, not • Higher quality – Allstate, the second largest general just the largest corporations, to consider the benefits they insurer in the US, sponsored a competition in which the can achieve from the crowd. crowd created a liability prediction model that was 271 per cent more accurate than the original.66

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Don’t get lost in the crowd In Figure 4, we explore the key issues and questions that Crowdsourcing has broad implications for every business leaders should be asking before committing to organisation attempting to use its business model, and the crowd. decision-makers face a complex array of risks and issues that, left unchecked, may prevent them from achieving Although crowdsourcing is not the only answer, if it is the benefits they seek. Tinkering around the edges of your planned, initiated, managed and integrated according organisation to get ideas to flow is one thing but building to a defined strategy then it offers organisations a crowdsourcing into core delivery activities to realise benefits relatively easy way to experiment with new problem– at scale is not as straightforward as simply ‘outsourcing’ solving approaches, to design and develop new product challenges to established crowdsourcing platforms. prototypes, to make new connections and to develop talent – and to scale what works. Academics Eoin Whelan, Kieran Conby, et al, go so far as to suggest that, “the majority of the open innovation literature, across all fields of research, shows a bias towards its favourable aspects”.72 They suggest that a number of the inherent deficiencies of crowdsourcing also need to be brought to the attention of businesses. For example, there will always be aspects of business operations or governance too important or too risky to deliver using a faceless crowd. Moreover, simply handing off work to the crowd will not automatically lead to benefits. Instead, ensuring that ideas converge on an appropriate solution swiftly and cost-effectively means understanding how the crowd works and the steps that need to be taken to set up and manage its activities, and to integrate its outputs. In the same way that managing an offshore team requires additional investment in management effort, so too does the crowd.

Academics Whelan, Conby, et al, suggest that a number of the inherent deficiencies of crowdsourcing also need to be brought to the attention of businesses.

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Figure 4. Key issues and questions

Issue What’s the problem? Key questions to ask Suggested approaches

Lack of understanding • The crowdsourcing concept is • Where could crowdsourcing provide the • Identify a champion in your business to or conceptual clarity not clearly communicated or greatest beneﬁts to my business? For whom you can turn for expert advice about crowdsourcing understandable; there’s a lack example in innovation, access to talent and insight of consensus on what the term or process/task completion. • Assess whether you need to appoint a refers to • Is crowdsourcing right for my senior business owner, and if • Limited applicability of the organisation? And, if so, what is the crowdsourcing ﬁts with your existing crowd, and knowing when it is business case? plans for alternative delivery models the right approach • Where would there be too much risk • Ensure that you engage the right crowd • Finding the right platform and associated with crowdsourcing? for your type of problem partner • With whom do I interact within • Develop a clear, concise and coherent my organisation to collaborate strategy for using crowdsourcing in your and deliver? business • What are my competitors and peers doing with the crowd? What problems or opportunities do we share? • Can we use crowdsourcing to leapfrog our competitors or to steal a march in a new market?

Ensuring good quality • Ensuring a good quality of • Are my requirements well deﬁned? • Ensure that the context in which the of submissions from submissions • Do we understand how the ideas and crowdsourcing project sits is well solutions generated by the crowd will be understood by all internal parties as well the crowd • Minimising any additional integrated with our existing products and as the crowd effort associated with operations? • Aim for a balance in the scope of work managing the crowd or • Can the tasks or activities be easily between open activities (those that platform provider broken down into their component parts? require submission of a number of • Can we provide continuity between diverse ideas) and closed tasks (those crowd and in-house teams? For example, that focus on just getting a simple job do we know how to reassemble done) solutions for component parts, and do we have the right people to do this? • Are there other crowdsourcing projects from which I can draw lessons? • How do I ensure responsibility for and buy-in to products created by the crowd? Who will manage these once integrated into our organisation?

Difﬁculties associated • Working with the crowd • What and where are the bottlenecks • Focus internal teams on the bigger with outsourcing to requires a different, more open in our business that would prevent or picture – not just on the the crowd in approach compared to more inhibit crowd-based approaches? crowdsourced task – and make them traditional ‘line’ traditional delivery methods • Where does good practice exist responsible for and empowered to already in our organisation? deliver the integrated solution organisations • Governance processes are set • What will be the impact of • Identify ‘pilot’ activities at the edge of up to deal with classic rather crowdsourcing on our legacy the business that can be used as a than agile development approaches and systems? testbed for crowd-based development methodologies approaches, and also to test risk issues • Wholesale changes to business and appetite processes and assessment of • Follow-up pilots with new projects risk are difﬁcult, if not and activities to cement new ways of impossible working • Look for examples of best agile practice in your business, and bring ‘edge-leaders’ into the core • Engage early with operations, risk and legal

Challenges to talent • Permanent employees feel • Who in my organisation will be most • Identify clearly the boundaries between and organisational threatened when activities are affected by crowdsourcing and are ‘business-as-usual’ projects and crowd culture outsourced to the crowd they supportive? projects • Encourage employees to participate in • The organisation feels like it is • Do I understand where the crowd is the crowd to develop new skills and losing control and ownership The better-placed three billion to answerEnterprise questions crowdsourcing and the growing fragmentation of work 11 experience – but set reasonable limits of the solutions it delivers than my permanent staff? • Encourage employees to collaborate • Ability to scale up and down • How can (and should) I enable my and work across organisational resource as demand varies employees to engage as part of the crowd? boundaries – exploiting synergies and • Difﬁculty in attracting the right • Where can the crowd be used best to different ways of thinking talent quickly enough to solve enable my employees to spend more • Identify similar historical projects my problems time on their highest value activities? hosted by crowdsourcing platforms and encourage employees to attempt • How do the projects ﬁt with our these challenges and learn from them strategy? What other impacts will there be on our organisational structure and talent?

Keeping hold of • The creation of work products • Have we identiﬁed the potential risks, • Before sending data to the crowd, conﬁdential by the crowd could lead to and do we have a plan to mitigate them? work to anonymise or obfuscate data information and intellectual property appropriately • Have we made security and privacy a intellectual property, infringement and reuse risks • Break down problems into smaller, priority? and additional risks • Crowd members are strangers discrete components to ensure they • Do we control or understand all of the associated with to the organisation, and have are tackled systematically and carefully assets that the crowd will use in using the crowd not necessarily gone through – then integrate the solutions generating their ideas and solutions? the same rigorous recruitment • Draft a risk register and clear project Who has access to these? process plan • Do we understand the standard terms • Misuse and leakage of data is and conditions of the contract with an increasingly large risk given the crowdsourcing platform provider? the increasing volumes of data being used, produced and • Have we thought about what our stored by the crowd and customers think about our use of the crowdsourcing platforms crowd and how are we engaging them?

Source: Deloitte Figure 4. Key issues and questions

Issue What’s the problem? Key questions to ask Suggested approaches

Ensuring good quality • Ensuring a good quality of • Are my requirements well deﬁned? • Ensure that the context in which the of submissions from submissions • Do we understand how the ideas and crowdsourcing project sits is well solutions generated by the crowd will be understood by all internal parties as well the crowd • Minimising any additional integrated with our existing products and as the crowd effort associated with operations? • Aim for a balance in the scope of work managing the crowd or • Can the tasks or activities be easily between open activities (those that platform provider broken down into their component parts? require submission of a number of • Can we provide continuity between diverse ideas) and closed tasks (those crowd and in-house teams? For example, that focus on just getting a simple job do we know how to reassemble done) solutions for component parts, and do we have the right people to do this? To start a new section, hold down the apple+shift keys and click • Are there other crowdsourcing projects to release this object and type the section title in the box below. from which I can draw lessons? • How do I ensure responsibility for and buy-in to products created by the crowd? Who will manage these once integrated into our organisation?

Challenges to talent • Permanent employees feel • Who in my organisation will be most • Identify clearly the boundaries between and organisational threatened when activities are affected by crowdsourcing and are ‘business-as-usual’ projects and crowd culture outsourced to the crowd they supportive? projects • Encourage employees to participate in • The organisation feels like it is • Do I understand where the crowd is the crowd to develop new skills and losing control and ownership better-placed to answer questions experience – but set reasonable limits of the solutions it delivers than my permanent staff? • Encourage employees to collaborate • Ability to scale up and down • How can (and should) I enable my and work across organisational resource as demand varies employees to engage as part of the crowd? boundaries – exploiting synergies and • Difﬁculty in attracting the right • Where can the crowd be used best to different ways of thinking talent quickly enough to solve enable my employees to spend more • Identify similar historical projects my problems time on their highest value activities? hosted by crowdsourcing platforms and encourage employees to attempt • How do the projects ﬁt with our these challenges and learn from them strategy? What other impacts will there be on our organisational structure and talent?

Source: Deloitte

12 To start a new section, hold down the apple+shift keys and click to release this object and type the section title in the box below.

From closed to open

“Challenges ask great questions. How can we do something better? Open innovation is about asking to do more with less, to do things better and faster and to get a great diversity of insight.”

Matt Chapman 73

For centuries, traditional businesses have relied upon As a consequence, organisations that fail to harness the closed approaches for their success: they recruit and retain strength and diversity of the crowd, instead adopting specialists, and then deepen their skills and experience a ‘wait-and-see’ attitude, are likely to be overtaken by over the ensuing years; they develop proprietary tools, stripped-down, more nimble organisations that appreciate tactics, techniques and procedures to help them do the shrinking half-life of knowledge and the power of business, drawing upon decades of project work and connectivity over in-house content. intellectual property; they sell products and services that evolve only gradually and compete in markets where For start-ups and entrepreneurs, interest in the the competition is doing the same; and they build up a crowdsourcing space is growing rapidly. For legacy protective armour of sorts, shielding themselves against organisations more averse to risk and experimentation, risk and change. Being closed, and keeping things ‘ the situation is not quite so certain. However, the stability in-house’, was simply the way that businesses worked. and scope of services now offered by today’s enterprise Failures could be kept locked up; credit for successes could crowd platforms should stir ever-greater numbers into be clearly assigned. action. These organisations can start by identifying specific opportunities where inherently closed approaches But today’s dynamic operating environment demands a to current challenges create bottlenecks to innovation, different and more agile approach from businesses and slowing down processes and driving up costs. By solving other organisations. And while some bold predictions concrete – even if small – problems at their edges, suggest that crowdsourcing will put an end to these organisations can more effectively identify the technical, working conventions overnight, the reality is that the organisational, cultural and talent changes necessary to crowd offers a practical way for enterprises to experiment, realise the broader benefits of crowdsourcing – and then to interact with the crowd and to offer faster, better, and scale and repeat. sometimes cheaper solutions. For individual workers, too, crowdsourcing provides an opportunity to engage with Ultimately, crowdsourcing is not just about greater access businesses in a new way, to work with experts from a to talent. It is also about tapping into new sources of data wide array of different fields, to develop new skills and and deeper pools of knowledge that cannot easily be interests, and, if they so desire, to take on challenges with accessed by any other approach. Alongside technologies a real social purpose. like artificial intelligence and robotics, crowdsourcing looks set to play a pivotal role in future business. It will affect the Linus Pauling, the American scientist, author and educator, way that workers and organisations interact, the way that said, “If you want to have good ideas you must have businesses engage with their customers and, ultimately, many ideas. Most of them will be wrong, and what you the productivity and diversity of our economy. have to learn is which ones to throw away.”74 As the crowdsourcing ecosystem and the online population both steadily build over the next few years, the opportunities that exist for businesses and public sector organisations to discover and develop “good ideas” will multiply rapidly.

The three billion Enterprise crowdsourcing and the growing fragmentation of work 13 To start a new section, hold down the apple+shift keys and click to release this object and type the section title in the box below.

Endnotes

1. “Using the Crowd as an Innovation Partner”, Kevin J. Boudreau and Karim R. Lakhani, Harvard Business Review, April 2013. See also: https://hbr.org/2013/04/using-the-crowd-as-an-innovation-partner/ 2. “Weighing the World: The Quest to Measure the Earth”, Edwin Danson, Oxford University Press, 2006. 3. Ibid 4. “Longitude found: John Harrison”, Royal Museums Greenwich. See: http://www.rmg.co.uk/discover/explore/longitude-found-john- harrison 5. “John Harrison’s ‘longitude’ clock sets new record – 300 years on”, Steve Connor, The Independent, 18 April 2015. See also: http:// www.independent.co.uk/news/science/john-harrisons-longitude-clock-sets-new-record-300-years-on-10187304.html 6. “How the Oxford English Dictionary started out like Wikipedia”, Nate Lanxon, Wired.co.uk, 13 January 2011. See also: http://www. wired.co.uk/news/archive/2011-01/13/the-oxford-english-wiktionary 7. Ibid. 8. Wikipedia statistics from: https://en.wikipedia.org/wiki/Special:Statistics, accessed 24 March 2016. 9. “Corporate crowdsourcing”, IdeaConnection. See also: http://www.ideaconnection.com/crowdsourcing/ 10. “On Language”, William Safire, New York Times Magazine, 5 February 2009. 11. “Crowdsourcing: A Definition”, Jeff Howe, Crowdsourcing Blog, 2 June 2006. See also: http://crowdsourcing.typepad.com/ cs/2006/06/crowdsourcing_a.html 12. See: http://lunar.xprize.org/ 13. See: http://www.michelsonprizeandgrants.org/michelson-prize 14. See: https://longitudeprize.org/ 15. See: http://www.lionbridge.com/ 16. See: http://www.samasource.org/ 17. See http://www.wikistrat.com/ 18. See: https://www.onfrontiers.com/ 19. See http://www.10eqs.com/ 20. For example, see: https://www.experience.com/alumnus/article?channel_id=career_management&source_page=additional_ articles&article_id=article_1247505066959 21. “Deloitte Millennial Survey 2016”, DTTL, February 2016. See also: http://www2.deloitte.com/content/dam/Deloitte/global/ Documents/About-Deloitte/gx-millenial-survey-2016-exec-summary.pdf 22. “The State of Crowdsourcing in 2015: How the world’s biggest brands and companies are opening up to consumer creativity”, eYeka, 9 April 2015. See also: https://en.eyeka.com/resources/analyst-reports#CSreport2015?utm_campaign=csr&utm_ content=1&utm_medium=act&utm_source=prc&utm_term=en 23. “Predicts 2015: Sourcing Strategies Shift From ‘Built to Last’ to ‘Built to Adapt’”, Gartner, Inc., 26 November 2014. See also: https:// www.gartner.com/doc/2925517/predicts--sourcing-strategies-shift 24. See: https://en.eyeka.com/ 25. See: https://www.innocentive.com/ 26. See: https://www.kaggle.com/ 27. See: https://www.topcoder.com/ 28. See: http://www.gigwalk.com/ 29. See: https://www.upwork.com/ 30. See: https://99designs.co.uk/ 31. See: http://www.streetbees.com/ 32. See: http://www.designcrowd.co.uk/ 33. See: http://writology.com/ 34. “The new meaning of ‘open source talent’”, CIO Journal by Wall Street Journal, 24 September 2013. See also: http://deloitte.wsj. com/cio/2013/09/24/the-new-meaning-of-open-source-talent 35. “Using the Crowd as an Innovation Partner”, Kevin J. Boudreau and Karim R. Lakhani, Harvard Business Review, April 2013. See also: https://hbr.org/2013/04/using-the-crowd-as-an-innovation-partner/ 36. See: https://www.topcoder.com/tc?module=ComponentRecordbook&c=overall_money 37. “The rise of crowdsourcing”, Jeff Howe, Wired, 6 January 2006. See also: http://www.wired.com/2006/06/crowds/ 38. “Crowdsourcing: Why the Power of the Crowd is Driving the Future of Business”, Jeff Howe, September 2009. A summary of the book can be seen at: http://www.bizbriefings.com/Samples/IntInst%20---%20Crowdsourcing.PDF 39. See: http://www.seti.org/seti-institute/project/details/setilive 40. See: https://www.innocentive.com/ar/challenge/9933816 41. A widely cited problem-based crowdsourcing typology is that proposed in the book: “Crowdsourcing”, by Daren Brabham, published in 2013. His typology can also be seen at: http://www.intellitics.com/blog/2013/11/14/daren-brabham-crowdsourcing- typology/ 42. For types of crowdsourcing task are proposed in Jeff Howe’s book: “Crowdsourcing: Why the Power of the Crowd is Driving the Future of Business”, Jeff Howe, Crown Business, September 2009. 43. For an example of a platform-based typology, see: “Ross Dawson: Six tools to kickstart your crowdsourcing strategy”, Neil Davey, MyCustomer.com, 1 July 2010. See also: http://www.mycustomer.com/marketing/strategy/ross-dawson-six-tools-to-kickstart-your- crowdsourcing-strategy 44. See: https://www.taskrabbit.com/m/tasks 45. See: https://www.kaggle.com/ 46. See: http://www.pgconnectdevelop.com/ 47. See: https://www.collaborationjam.com/ 48. See: http://www.internetlivestats.com/internet-users/#trend 49. See: http://www.internetlivestats.com/internet-users-by-country/ 50. Ibid. 51. Number of mobile phone users worldwide from http://www.statista.com/statistics/274774/forecast-of-mobile-phone-users- worldwide/ 52. Ibid.

14 To start a new section, hold down the apple+shift keys and click to release this object and type the section title in the box below.

53. “Education 2030 Framework for Action – Towards inclusive and equitable quality education and lifelong learning for all”, UNESCO, December 2015. See also: http://unesdoc.unesco.org/images/0024/002432/243278e.pdf 54. Bill Joy quote - “How fast can you learn?”, Rich Karlgaard, Forbes, 9 November 2007. See also: http://www.forbes.com/ forbes/2007/1126/031.html 55. “Benefits of Crowdsourcing”, Vivek Wadhwa, The Wall Street Journal, 29 October 2014. See also: http://www.wsj.com/articles/ benefits-of-crowdsourcing-1414625224 56. “Using the Crowd as an Innovation Partner”, Kevin J. Boudreau and Karim R. Lakhani, Harvard Business Review, April 2013. See also: https://hbr.org/2013/04/using-the-crowd-as-an-innovation-partner/ 57. Ibid. 58. See: https://www.clickworker.com/ 59. See: http://www.gigwalk.com/ 60. See: https://www.onfrontiers.com/ 61. See: http://www.wikistrat.com/ 62. “Creativity Is Not Enough”, Theodore Levitt, Harvard Business Review, August 2002. See also: https://hbr.org/2002/08/creativity-is- not-enough 63. “How crowdsourcing can make products better, cheaper, faster: Lessons from a military-led amphibious tank project”, Professor Howard Yu, IMD. See also: http://www.imd.org/research/challenges/TC005-16-darpa-yu.cfm 64. “This is the Million-Dollar Design for DARPA’s Crowdsourced Swimming Tank”, Spencer Ackerman, Wired, April 2013. See also: http://www.wired.com/2013/04/darpa-fang-winner/ 65. “Step inside an inventor’s playground”, Ryan Bergeron, CNN, 9 October 2015. See also: http://edition.cnn.com/2015/10/09/living/ tech-shop-mike-rowe-somebodys-gotta-do-it/ 66. “Predicting liability for injury from car accidents”, Kaggle. See also: http://www.kaggle.com/solutions/casestudies/allstate 67. See: http://www.crowdsource.com/solutions/copywriting-services/product-descriptions/ 68. See: https://blog.taskrabbit.com/category/task-ideas-tips/ 69. See: https://hrtechadvisor.com/springrole-brings-crowdsourcing-gamification-recruiting/ 70. “Thomson Reuters uncovers internal engineering talent with crowdsourcing”, Nicole Laskowski, TechTarget, April 2014. See also: http://searchcio.techtarget.com/opinion/Thomson-Reuters-flushes-out-internal-engineering-talent-with-crowdsourcing 71. “A Tongal-produced ad scores a Super Bowl touchdown,” Peter Diamandis, Huffington Post, March 4, 2013. See also: http://www. huffingtonpost.com/peter-diamandis/a-tongal-produced-ad-scor_b_2806396.html 72. “Editorial: The Role of Information Systems in Enabling Open Innovation”, Whelan, E., Conboy, K., Crowston, K., Morgan, L., Rossi, M., Journal of the Association for Information Systems, Volume 15, Special Issue, November 2014. See also: http://aisel.aisnet.org/ cgi/viewcontent.cgi?article=1692&context=jais 73. “13 revealing quotes on open innovation in humanitarian organisations”, Lauren Parater, UNHCR Innovation, 3 August 2015. See also: http://innovation.unhcr.org/13-revealing-quotes-on-open-innovation-in-humanitarian-organizations/ 74. “The Impact of Linus Pauling on Molecular Biology”, Francis Crick, The Pauling Symposium 1995, Oregon State University. See also: http://oregonstate.edu/dept/Special_Collections/subpages/ahp/1995symposium/crick.html

The three billion Enterprise crowdsourcing and the growing fragmentation of work 15 To start a new section, hold down the apple+shift keys and click to release this object and type the section title in the box below.

Contacts

Vimi Grewal-Carr Greg Howard Managing Partner for Innovation Deloitte Pixel Lead +44 (0)20 7303 7859 +44 (0)20 7303 8225 [email protected] [email protected]

Carl Bates Harvey Lewis Partner, Lead for Crowdsourcing Director of Insight +44 (0)20 7007 7590 +44 (0)20 7303 6805 [email protected] [email protected]

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